Survey of apprenticeship pay

Labour & European Law ReviewWeekly Issue 40107 January 2015

According to a government survey of apprenticeship pay published last month, around 42 per cent of apprentices in hairdressing and 26 per cent of apprentices in children’s care were not being paid the correct rate under the National Minimum Wage (NMW). Both these sectors have a high proportion of female apprentices.

Younger apprentices were also more likely to be earning less than the NMW, with nearly aquarter (24 per cent) of 16 to18 year olds having non-compliant pay levels, compared with 20 per cent of 19 to 20 year olds, 17 per cent of those aged 21 to 24, and eight per cent of those aged 25 or older.

High levels of non-compliance were also found among those employed for the duration of the apprenticeship only (28 per cent); those who had been on the course for more than a year (27 per cent); and those who had not worked for their employer before they started their apprenticeship (23 per cent).

This is despite the fact that, at the time of the survey, the NMW rate for apprentices was a mere £2.68 per hour for 16 to 18 year olds or those in the first year of their apprenticeship; £5.03 for those in their second year or later and aged 19 to 20; and £6.31 for those in their second year or later and aged 21 and over.

The survey also found that although the vast majority (94 per cent) of apprentices had heard of the National Minimum Wage, and three-fifths were aware that there is a specific rate for certain apprentices (62 per cent), only around a quarter (26 per cent) knew or claimed to know the actual minimum rate for apprentices.

Given this widespread pay exploitation, the TUC General Secretary Frances O’Grady, has urged the government to “focus more minimum wage enforcement action on tackling apprenticeships pay abuses and withdraw training funding from cheating employers.” She also pointed out that “tackling abuse would be made easier if apprenticeship minimum wages were simplified and increased to the same level as for other young workers.”

Iain Birrell of Thompsons Solicitors commented: “In 2011 Vince Cable declared “Apprenticeships are proven to boost the life chances of young people, and are a sound investment in our future competitiveness. So when times are tough, it’s right that we provide additional support to help the smallest firms meet training costs. We’ll cut no corners on quality.”

The government pays £1,500 to SME employers who hire their first apprentices and it funds all or part of training costs. It is an utter disgrace that 24% of employers won’t even pay the paltry £2.73 per hour minimum wage despite that being 28% less than the NMW rate payable to children. It is time for the government to step up and end this exploitation.”

The survey involved interviews with 9,367 apprentices, conducted by telephone from 22 July 2014 to 14 September 2014.